New Year Financial Check Up

START THE NEW YEAR OFF RIGHT by taking a good, hard look at your personal finances. January is a great time to re-evaluate your goals, income, expenses, and savings for the year ahead. By doing this now, you will achieve a more prosperous and stress-free financial picture in 2009.

Consider these factors when doing your financial check up:

  1. Check your cash flow - Create a spreadsheet. In one column include all of your sources of income and the amounts. In another column, calculate all of your expenses including automatic savings and retirement contributions. The difference between the first column and second column should be in the positive territory. If not, review your expenses and cut out the fat. Then look over your income sources and find additional ways to make more money.

  2. Check your net worth - Take a look at where you stand with regards to your financial health. By taking a look at the big picture, you can discover ways to increase your overall net worth by reducing debt/liabilities, increasing assets, or doing both at the same time. It’s fairly simple to check your net worth. Add all your assets and subtract your liabilities. Regularly updating your net worth can help keep you on track to meet your financial goals.

  3. Cash Reserve - Do you have a cash reserve?
    You should have enough to cover the worst-case
    scenario. Some may believe that having a line of
    credit is enough. That is fine and dandy for those with good cash flow, but those with limited or no cash flow really should have an emergency fund.

  4. Credit Score - Get your credit report and check your credit
    score regularly to ensure that there aren’t any mistakes on your credit report that could pop up at the worst times (i.e. when you are applying for a mortgage).

  5. Insurance - Insurance is one of the most overlooked areas of personal finance, but it is vital that you have proper insurance to protect your dependents from financial disaster. If your (or your spouse's) income is cut off due to death or disability, will your family survive financially? Start by getting a term or whole life insurance policy. And then look into getting disability insurance to protect your main income in the case that you are disabled and unable to perform your job duties.

  6. Investments - How are your investments doing this year? Yes, the markets may be down but that’s not a reason to ignore your portfolio. Are you following your strategy? How about your retirement accounts? Have you made your contributions yet? If you’re invested for the long term with a diversified portfolio, most financial advisors would tell you to stay put.

  7. Debt - Time to review the dreaded debt on the balance sheet. There is good debt and bad debt. The good being money borrowed for an appreciating asset and is tax deductible. Bad debt is the opposite. This debt is typically credit card debt used to buy depreciating consumer items. Take the time to prioritize your debt and focus on paying it down one at a time.

Facts contained herein were researched and verified to the best of Capital Direct Lending Corp.’s ability. This article is intended to be a helpful resource; and not financial or tax advice. Always consult with your accountant or financial planner/ advisor on all matters related to your personal finances.

The great Canadian tax break!

FOR THE 2008 TAX YEAR, there are many tax deductions and credits you can benefit from.

Capital gains & donations (exchangeable securities) – The current tax treatment for donations of publicly traded securities is that when they are donated to registered charities or other qualified donee, the capital gain is exempt from tax. This tax treatment will continue to apply to donations made after February 25, 2008 and will be extended to capital gains on the exchange of unlisted securities (other than prescribed interests in a partnership) for publicly traded securities. For more information, please visit:
http://www.cra-arc.gc.ca/gncy/bdgt/2008/cptl-eng.html.

Health-related tax measures – For 2008 and subsequent years, you can claim the costs of purchasing, operating, and maintaining the following devices when they are prescribed by a medical practitioner: altered auditory feedback devices, electrotherapy devices, standing devices, pressure pulse therapy devices. Also, the cost, care, and maintenance of service animals that are specially trained to assist an individual who is severely affected by autism or epilepsy. For more information, please visit:
http://www.cra-arc.gc.ca/gncy/bdgt/2008/hlth-eng.html.

Registered Retirement Savings Plan (RESP) - Although contributions to an RESP are not tax deductible, the growth is not taxed until withdrawn. The lifetime contribution limit is $50,000 with no annual contribution limit, and if the beneficiary of the RESP is under the age of 18 the government provides a basic Canada Education Savings Grant equal to 20 percent of contributions up to $2500 of contributions per year.

Children's Fitness - If you registered your child in a physical activity program, you can claim up to $500 per child. The program must be ongoing, supervised, a suitable activity for children and lead to significant physical activity. The child must be under 16 years of age at the beginning of the year.

Public transit - You can claim the cost of monthly public transit passes or passes for longer durations such as an annual pass for travel within Canada on public transit throughout the year. Public transit includes local buses, streetcars, subways, commuter trains or buses, and local ferries.

Tax-free savings account (TFSA) – Starting in 2009, you can open this type of account at most financial institutions across Canada. Each year you will be allocated and allowed to contribute at least $5,000 to your TFSA. Any withdrawals made in the previous year will be added to the contribution room for the year. Any unused contribution room from the previous year would be added to the contribution room for the year. So for example, in 2009 you only contribute $2,000, so an amount of $3,000 would be carried forward to 2010 and so forth. You are allowed to have more than one TFSA. For more information about this new account, please visit:
http://www.cra-arc.gc.ca/gncy/bdgt/2008/txfr-eng.html.

For full details of these and other tax benefits, visit the Canada Customs and Revenue Agency web site at
http://www.cra-arc.gc.ca/menu-eng.html.

Facts contained herein were researched and verified to the best of Capital Direct Lending Corp.’s ability. This article is intended to be a helpful resource; and not financial or tax advice. Always consult with your accountant on all matters related to income taxes.

Testimonial

James and Wendi B. of Aurora, Ontario were looking to refinance their mortgage. “I found Capital Direct online and quickly discovered that they offer a hassle-free service with no other motive than to help its customers,” James explains. “When dealing with personal finances there are always many concerns, but we feel that Carmelo, our mortgage specialist, addressed all of our concerns to our satisfaction and with absolutely no pressure.”

“We really appreciated the fact that Capital Direct had our best interest at heart,” he explains, “Paying off our loan was a number one priority for us and for Capital Direct. The consultant was very straight forward and made sure that we understood every step of the process.”

So what about you? Do you find yourself in an unfamiliar financial situation? Your home equity is something you've worked hard to build, so why not 'let your house lend a hand'© when you need it most! Contact a Capital Direct mortgage specialist to discover your options.

“I trust this organization more than a bank.”

Reduce your environmental footprint

GO GREEN AND DO YOUR PART to save the planet in 2009. We can all make a difference.

Did you know that in moderate to cold climates, half of all energy is used for heating? So make sure that your home has proper installation and ventilation. This can reduce energy needs by one-third.

Turn your hot water tank down from high to medium, which is 45ºC.

Replace incandescent bulbs with compact fluorescents bulbs (CFLs). These bulbs use about 75% less energy than standard incandescent bulbs and last up to 10 times longer. Trade in your sedan or SUV for a compact fuel-efficient car or hybrid vehicle. The Canada Revenue Agency will reward you with a tax rebate.

Install low-flow showerheads and a low-flow kitchen aerator.

Buy efficient electrical appliances. They use 1/2 the electricity to perform the same function.

Wash your laundry in cold water.

Turn off the pilot light in the fireplace through the summer months.

Walk rather than drive as often as possible. It’s good for the environment and your health.

To Learn more about these and other ways to reduce your environmental footprint visit these websites:

Recycling Council of British Columbia
http://www.rcbc.bc.ca

Recycling Council of Albert
http://www.recycle.ab.ca

Recycling Council of Ontario
http:// www.rco.on.ca

Capital Direct's Eco-friendly Calculator

Do you know how large your home's eco-footprint is? Under the ecoEnergy Retrofit program, homeowners can take advantage of available grants when improving the energy efficiency of their home. Not only will you be reducing your home's energy consumption but you can receive money back through available grants.

Visit Capital Direct's Eco-friendly Calculator online at, https://www.capitaldirect.ca/eco-calculator. Calculate the environmental impact of your household and find out ways of reducing it, then give us a call to learn how we can help you apply for available retrofit grants.


New Year Super Puzzle

Get in the 2009 financial planning mood
with our January Super Puzzle.
First unscramble the letters then find
the words below. Good luck!

  1. YRAAJUN
  2. AWYRNEE
  3. HSSTARETFR
  4. UPCKCEH
  5. IRTWNE
  6. XSOSENATA
  7. TNOHEWRT
  8. NCUIADOET
  9. EIRMERTTNE
  10. ASGSINV
  11. EOMINC
  12. TEUOICDNA
  13. LAINGPNN
  14. DGUNTBEGI














G K H F R E B I M D A P J R M F M R R V E H K M W J H A X S A Y R E N V T T K X F P N B T C O E S S E B I R A W G U L U A X E H G I W P R O S N A H N U U Z S N W Q Y Q E W I R K K B D Y T I N T Z E N M T Y A K R X Z A V F M K O A Z E E K T J H J R A D A I F U R G N N G V N F T S O T Z R E H D P T T T A X S E A S O N E C U R C G W C H E C K U P B P T B A E V V D J U U F H N R F S N A I E I M D E M O C N I P B I
I W Q 		Q E G N I N N A L P D Y E W V

Share Your Story and Win $5000
Discover how you can make the most of home ownership!
Visit us at www.CapitalDirect.ca for more information.